Antipodean currencies dominate action in Asia

Asia Mid-Session Market Update: Antipodean currencies dominate action in Asia, AUD falls close to 1% on RBA comments; Kiwi supported by remarks by NZ Finance Minister

Asia Summary

- Following the flattish session in the US, most of the equity markets in Asia are slightly weaker. Australia’s ASX 200 has somewhat underperformed amid some weakness in BHP, Woodside Petroleum and the banking sector.

Key economic data

- (NZ) New Zealand June Credit Card Spending M/M: 0.2% v 0.9% prior; Y/Y: 8.3% v 7.6% prior

- (NZ) NEW ZEALAND JUNE NET MIGRATION SA: 6.4K V 5.9K PRIOR

- (JP) JAPAN FOREIGN BOND BUYING: 947.8 ¥ V ¥839.5B PRIOR; STOCK BUYING ¥438.6B V ¥324.9B PRIOR - WEEK ENDED JULY 14TH; Foreign Buying of Japan Bonds ¥413.7B v -¥408.5B prior; Foreign Buying of Japan Stocks ¥341B v -¥35.0Be prior

- (KR) South Korea July Exports 20 Days Y/Y: 22.4% v 24.4% prior; Imports: 13.3% v 20.7% y/y

Speakers and Press

Australia

- (AU) RBA ASSIST GOV DEBELLE: NO SIGNIFICANCE IN BOARD DISCUSSING NEUTRAL RATE; Higher Aussie works against benefits of faster global growth

China

- (CN) China said to ask state owned enterprises (SOE)s to avoid blind financial investments - Chinese Press; Also, asks SOEs to strengthen financial risk management.

Japan

- (JP) Japan Fin Min Aso: Reiterates no change to goal of reaching primary balance surplus; Want to continue trend of issuing fewer govt bonds; Discussion to 'pick up' on consumption tax.

- (JP) Japan Foreign Minister Kishida: UK Foreign Sec Boris Johnson promised to minimize Brexit impact on corporate activity

Other

- (GR) IMF confirms approval of $1.8B conditional loan for Greece (as expected)

- (KR) South Korea urges North Korea to respond to military talks offer which is valid until July 27th - Korean press

- (NZ) New Zealand Fin Min Joyce: 'Unperturbed' by NZD strength, kiwi dollar strength reflects strong economy; Domestic firms dealing 'well' with Kiwi at current levels.

- (PH) Philippines Central Bank (BSP) Deputy Gov Guinigundo: Very little reason to start mulling raising rates

- (TW) Taiwan President's Office denies report that Premier to resign

- (US) US President Trump said to ask lawyers about pardoning abilities in relation to Russia probe – US press

- (US) President Trump said to have made changes to legal team – CNN; Trump’s longtime personal attorney Marc Kasowitz said to be taking a lesser role with regards to the US special counsel Mueller’s probe into Russia.

Asian Equity Indices/Futures (00:30ET)

- Nikkei -0.3%, Hang Seng -0.2%, Shanghai Composite -0.2%, ASX200 -0.2%, Kospi +0.3%

- Equity Futures: S&P500 flat ; Nasdaq -0.2% , Dax flat, FTSE100 -0.1%

FX ranges/Commodities/Fixed Income (00:30ET)

- EUR 1.1637-1.1620; JPY 112.08-111.81; AUD 0.7960-0.7876; NZD 0.7429-0.7394

- Aug Gold -0.1% at 1,244 /oz; Aug Crude Oil flat at $46.91/brl; Sept Copper flat at $2.72/lb

- GLD SPDR Gold Trust ETF daily holdings unchanged at 816 tonnes

- (AU) Australia sells A$500M in 2.0% Dec 2021 bonds, avg yield 2.1996% v 2.1693 prior, bid to cover 6.58x v 5.46x prior

- (CN) China PBOC OMO injects CNY140B in 7 and 14 day reverse repos v CNY60B prior

- (CN) PBOC SETS YUAN REFERENCE RATE AT V 6.7415 V 6.7464 PRIOR

- (CN) China MOF sells 30-year bonds at avg yield 4.05%, bid to cover 1.7x

- Australia 3-year bond yield declines over 8bps as RBA’s Debelle plays down Neutral Rate comment in recent RBA minutes

Equities notable movers

Hong Kong/China

- BYD, 1211.HK H1 Guidance; +1.5%

- CK Instructure, 1038.HK H1 net earnings and raised dividend; +4.5%

Japan

- Yaskawa Electric, 6506.JP Q1 earnings speculation; +10%

- Nikon, 7731.JP Positive broker commentary; +2%

US markets on close: Dow -0.1%, S&P500 flat, Nasdaq +0.1%, Russell flat

- Best Sector in S&P500: Utilities +0.7%

- Worst Sector in S&P500: Materials -0.7%\

- At the close: VIX 9.58 (-0.21 pts); Treasuries: 2-yr 1.356% (flat), 10-yr 2.266% (-0.2%), 30-yr 2.831% (-0.7%)

US Market Summary

- Stock markets were quiet today, with mixed sentiment showing little volatility in price, although the Nasdaq still managed to post a new all-time high. The Transports underperformed notably for the second straight session as traders appear to be ready to take profits in those names. Stocks dropped on the initial news that Special Counsel Mueller is investigating President Trump's financial dealings, but pared its losses within a half-hour. The VIX index continued to decline, falling by 2% to 9.60.

US Afterhours Movers

-ATHN Reports Q2 $0.51 v $0.40e, Rev $301.1M v $298Me; Affirms FY17 Rev $1.21-1.25B v $1.24Be (prior $1.21-1.25B) ; +9.8% afterhours

-COF Reports Q2 $1.94 v $1.90e, Rev $6.70B v $6.7Be; +4.6% afterhours

-MSFT Reports Q4 $0.98 v $0.71e, Rev $24.7B v $24.2Be; Productivity and Business Processes Rev $8.4B, +21% y/y, +23% constant FX ; +1.9% afterhours

-V Reports Q3 $0.86 v $0.80e, Rev $4.57B v $4.36B; Affirms FY17 op margin mid 60's% (prior mid 60's%) ; +1% afterhours

-SKX Reports Q2 $0.38 v $0.44e, Rev $1.03B v $966Me

- Guides Q3 $0.42-0.47 v $0.56e, Rev $1.05-1.08B v $1.06Be; -1.5% afterhours

-EBAY Reports Q2 $0.45 v $0.45e, Rev $2.33B v $2.31Be; approves $3B buyback (7% of market cap)- Guides Q3 $0.46-0.48 v $0.48e; R$2.35-2.39B v $2.32Be ; -2.6% afterhours

-MXIM Reports Q4 $0.63 v $0.62e, Rev $602M v $608Me; Raises quarterly dividend by 9.1% to $0.36/shr (indicated yield 3.01%)- Guides Q1 $0.52-0.58 v $0.58e, R$555-595M v $596Me, adj gross margin 65-68%; -5.5% afterhours\

-NCR Reports Q2 $0.80 v $0.75e, Rev $1.59B v $1.61Be; Guides Q3 $0.88-0.93 v $0.93e, R$1.66-1.70B v $1.73Be ; -7.2% afterhours

-MANH Reports Q2 $0.50 v $0.48e, Rev $154.1M v $154Me; Cuts FY17 $1.85-1.89 v $1.90e, R$590-600M v $611Me (prior $1.89-1.93, R$606-620M); -8.3% afterhours

- Earnings from GE expected in the New York morning.